Continued high revenues from bitumen royalties, corporate income tax and other revenue streams have sustained a forecasted surplus of $12.3 billion this fiscal year. Even as economic growth is expected to slow next year across the country and around the world, Alberta’s commitment to fiscal responsibility will ensure the province maintains its position as the economic engine of Canada.
With revenue forecast at $76.9 billion and expense at $64.6 billion, this surplus is allowing Alberta’s government to pay down debt by $13.4 billion this fiscal year. This reduces taxpayer-supported debt to $79.8 billion and saves Albertans millions in interest payments. As well, the government will commit another $10.8 billion over the next three years towards savings, debt reduction and other priorities to further secure Alberta’s future economic prosperity.
"When I became Premier, I promised we would continue to balance the budget so Albertans aren’t on the hook for rising debt, while also reaching out a helping hand with compassion to those who need it most. We remain focused on doing everything we can to make life more affordable for every Albertan, and to strengthen the economy through jobs and diversification to provide opportunities, prosperity and freedom to all Albertans and families.”
“Our disciplined fiscal approach combined with our focus on investment attraction, economic growth, and improved commodity prices, has resulted in material surpluses. This is good news for Albertans, as it allows for a timely response to the affordability crisis many of our families are facing. In the face of a potential global recession, Albertans can rest assured our province is in the best position possible as a result of our focus on responsible fiscal management over the last three years. By investing in savings and reducing debt for future generations, we continue to make Alberta the best place to live, work and raise a family.”
Economic outlook
Alberta’s economic outlook remains solid, but risks are increasing. High inflation, rising interest rates and geopolitical unrest are slowing global economic activity. Alberta’s economy is positioned well to weather these challenges. Oil prices have softened but remained robust, boosting revenues in the energy sector. Strong growth in non-energy business output has also boosted export revenues and corporate profits since the start of the year. Investment is gaining momentum and Alberta’s housing market is faring much better than the rest of the country.
Alberta’s real gross domestic product is expected to grow 4.8 per cent in 2022 and 2.7 per cent in 2023. The province’s strong fundamentals – including a young and growing population, high earnings and a low cost of living – will continue to support growth in the years to come.
Quick facts
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The surplus for 2022-23 is forecast at $12.3 billion. This is lower than the $13.2-billion surplus estimated at the first quarter fiscal update at the end of August, due to softening oil prices and demand.
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The surplus estimate for 2023-24 is $5.6 billion, then $5.3 billion in 2024-25.
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Total revenue in 2022-23 is forecast at $76.9 billion, $1 billion higher than the first quarter fiscal update and $14.3 billion higher than the budget estimate.
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Non-renewable resource revenues continue to drive the increase, with bitumen royalties of $19.4 billion forecast this year.
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Corporate income tax revenues are forecast at $6.3 billion.
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Revenue from personal income taxes are forecast at $13.3 billion.
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Indexing personal income taxes and the government’s pause in collecting fuel tax have offset some of the increase in revenue.
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Total expense is forecast at $64.6 billion, $1.9 higher than the first quarter fiscal update and $2.5 billion higher than estimated at budget.
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Taxpayer-supported debt is forecast to be $79.8 billion on March 31, 2023, a $13.3 billion reduction from the end of 2022 because of significant debt repayment.
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The net debt-to-GDP ratio is estimated at 9.9 per cent for the end of the fiscal year.